Metro Bank enters vehicle financing market

Metro Bank has announced it is entering the vehicle financing market in the UK with the launch of a digital car loan product.

It is marketed under the RateSetter name and provides purchase loans for used vehicles. CarFinance 247 and Motion Finance are currently testing the concept. With Metro Bank now on their panel, CarFinance 247, which already receives over 100,000 applications each month, aims to assist even more customers in finding the ideal financing option.

Metro Bank is entering the vehicle financing market in the UK with the launch of a digital car loan product.

RateSetter, a platform for peer-to-peer lending that Metro Bank purchased in 2020, currently has more than 800,000 users and has distributed more than USD 4 billion in loans. According to Metro Bank, RateSetter’s technology will enable an ‘automatic and real-time’ decision-making process that will give each customer a tailored loan rate.

Eligible consumers would reportedly be able to drive their car off the showroom the same day with a paperless application process, making it an effective process for both borrowers and brokers.More partnerships are anticipated to begin ‘in the coming weeks’, according to Metro Bank.

Transforming auto loans

As digitisation replaces paper forms and manual ID checks, the process of applying for a car loan or lease, whether in the dealership or remotely, is becoming quicker and more secure. One way that auto finance lenders might embrace digital transformation is by automating the loan application process. Automated lending processes can aid with loan volume growth, operational cost reduction, and managed workflow rule compliance.

By implementing digital identity verification, vehicle finance companies in Europe are redefining the auto finance procedure. Automated features such as digitally verifying identity documents like a passport, driver’s license, or national ID card are included in this (using smartphones to capture an image of an identity document, which is then analysed to determine its authenticity.) This can happen in-person with the applicant at the dealership or online with a distant candidate.

Additionally, it provides face recognition for remote situations where the consumer is asking for financing from their home, business, or anywhere else by comparing a selfie with the image on a passport or ID card.

Auto loans digitalisation in UK

Santander Consumer Finance, based in the UK, is one lender setting the pace. Santander provides financing via a network of dealers and collaborates with major automakers like Hyundai, Kia, Volvo, and Mazda. Using e-signatures and digital identity verification, Santander Consumer Financing sought to digitise in-dealership auto finance loan applications in 2018. The label ‘i-click’ online auto finance procedure is entirely browser-based. Customers may easily and quickly apply for financing using the service, and dealers can speed up and boost the number of sales.

Early in 2021, Your Red Car, an online platform for dealers to sell vehicles to consumers, was introduced by Santander Consumer Finance (SCF). The dealers are able to post their stock feed directly to the Your Red Car website for free thanks to a partnership with SCF. Only when the vehicle is sold the dealers have to pay a charge. Dealers may lower margin expenses and increase sales by using Your Red Car.

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